DSV saw an increase in airfreight volumes in the first quarter of 2024, primarily due to strong demand out of Asia. However, despite the volume growth, the company experienced a drop in both revenue and profit as market rates declined.
The airfreight volumes for DSV increased by 2.3% in the first quarter, reaching 335,213 tonnes compared to 327,712 tonnes in the same period last year. The growth was mainly attributed to strong export volumes from the Asia Pacific region, driven by high growth in e-commerce volumes from China.
While the airfreight market is facing overcapacity, DSV expressed optimism that the retirement of old aircraft will help balance this excess capacity. Despite this, the company reported a significant decrease in airfreight revenue and gross profit.
Overall, the Air & Sea division of DSV recorded an 11.5% decline in revenue for the first quarter, with gross profit also falling by 16.2%. The company noted that this decline was due to a normalization of freight rates and yields, offset somewhat by volume growth in both air and sea.
EBIT before special items also decreased by 26% in the first quarter of 2024 compared to the previous year. Across the entire group, revenue fell by 5% to Dkr38.4bn, and gross profit declined by 8.6% to Dkr10.3bn.
Despite the challenges, DSV’s group chief executive, Jens Lund, expressed satisfaction with the company’s financial performance in the first quarter. He highlighted the market share gains in all three divisions and emphasized the focus on executing the company’s strategy for organic growth and mergers and acquisitions (M&A).
Looking ahead, DSV indicated a focus on strengthening operational and commercial aspects of the business, with M&A continuing to be a key component of their strategy. The company also mentioned progress on its NEOM logistics joint venture, stating that it is mobilized and set to go live in the second quarter as planned, with expectations for activities to ramp up over the next few years.
